Wednesday, 16 July 2014

CEM in the age of mobile

As the Indian economy grows, competition in almost every industry is also growing, making it difficult for companies to retain customers and remain profitable. It has become difficult to influence customers through the traditional ways of push marketing as there has been information overload of all these mass advertisements. Thus, people have become immune to these marketing tactics. The solution to this problem is establishing sustainable competitive advantage by implementing comprehensive Customer Engagement Management (CEM) strategies. CEM tries to create an emotional bond with the customer by providing positive and personalized experiences at every touch point.  But, just the realization of this concept by companies does not automatically result into a solution. Customer expectations are changing rapidly with the increase in the number of options and there is an urgent need of a CEM solution that truly focuses on the customer.
There has to be a shift in the age old mindset of ‘spray & pray’. Monetary resources that are not being used productively in traditional marketing approaches like TV commercials, newspaper ads, billboards; etc could be utilized more effectively by putting them towards engagement programs that tend to deliver the desired results. Engagement program becomes more important when you consider the fact that cost of acquiring a new customer is approximately 5-10 times more than selling to an existing customer and the existing customers spend 67% more than a new one according to Inc. Magazine. 

Engagement domain, despite coming into focus recently, is itself having a paradigm shift. Most of the surveys are suggesting that for CEM, a continuous touchpoint is needed as a main communication channel. In today’s world, I don’t believe that there is an engagement channel which is more personalized & instant than a mobile phone. Thus, mobile phone becomes a prime option in the list of preferred customer engagement channels. Mobile penetration is rapidly growing in India with customer base of around 773 million active subscribers according to TRAI. In fact, India is only next to China when it comes to the number of mobile subscribers.  As mobile becomes the easiest way to reach a customer, it would play the centre stage around which all Customer Engagement Strategies will be built. With Smartphone penetration in India hovering around 10 percent and quickly growing, it will also play a major role in the scheme of things in the future. Presently, SMS should be the preferred communicating channel for different engagement programs being run by the company along with the usual emails and web portal. The SMS should contain personal identifiers so that it becomes more engaging and cuts across the plethora of SMSs that the customer gets on his phone. SMS could be used to keep the customer updated about various parameters of the engagement program such as - start of the engagement program, targeted offers, points earned and redeemed (if it’s a points based program) & many more aspects. The program could also use inbound SMSs to register the previously unknown customers into the program. For example, say an electrician buys an electric fan and SMSs the a unique code pasted on the box to a specific number and in this way he is registered in the engagement program run by the fan company.
There are many aspects that constitute a successful engagement program. Different engagement stages like enroll, engage and encash should work together seamlessly and should provide excellent user experience. The enrollment process should be frictionless so that there is no attrition at the enrollment stage. There should be unique journeys for all participants and their experience should be gamified for maximum engagement. Also, the participants should be able to choose the rewards themselves from a catalog which can be both online in the form of a web portal as well as offline like displayed as posters or given as a booklet. By sending personalized SMSs and providing the flexibility for the customers choose their own gifts from the points earned, the engagement program becomes highly personalized.
Customers here can be both internal such as employees and external like channel partners (dealers, distributors, retailers etc.) and influencers like mechanics, painters and electricians and of course end consumers.
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Monday, 14 July 2014

Will Beacons be the ‘guiding lights’ of Customer Engagement? (2/2)

In the first part of this article, we saw the possible uses of Beacon in typical retail stores. With the ubiquitous nature of the technology (it is present in most of the iPhones [] & applications are being developed for android platform also []), beacons won’t be found only in retail outlets. It is imperative that such an impressive & energy efficient technology would be used in many other sectors. To name a few of them – security applications, events, conferences, home automation etc.  

In the security landscape, beacons could be found in applications similar to RFID tags, with the ability to do many more things. You could create a geofence, tag valuable items in an area & keep on continuously polling them with the help of beacons (this is very similar to other proximity sensors, except beacons have a much larger range & bidirectional communicational ability). Whenever that item is taken outside the geofence, we can set a certain steps of actions to be taken. The other (inverse) variant of this application is the ability to set restricted areas. You can set triggers/alarms when an item enters a pre-set restricted area. One other application of geofencing might be to disseminate information only to devices/people located in a particular area.       

This ability to send the information selectively based on micro-locations of recipients opens up yet another domain – use of beacons at exhibitions, events, conferences etc. Now when you stand in front of a particular stall, you’ll receive information pertaining to the products & services of only that exhibition stall. Similarly, whenever a notification is to be sent to a group of people present in a particular area of an event (Ex. The attendees in a particular conference room could be sent notifications relevant to the ongoing session in that particular zone/area), beacons could be the way to go.  Also, beacons provide the unique ability to have peer-to-peer communications of like-minded people. For example, at a tech conference, you can identify the people having similar prime interest as you (e.g. wireless technologies) & meet them to have a personal dialog with them. It would be of a great help in cutting through the crowd at such events/conferences & converse with people with whom you actually want to exchange ideas. The ability of beacons to provide a context would give unparalleled levels of engagement & greatly efficient user experiences.     
Deployment of beacons may look tedious to marketers, but they stand to gain great advantages from them. For retailers at least, there will not be any major changes in their business processes. The technology could very well complement their existing marketing communication framework. Even so, they can gain following benefits from beacon deployment: 1. Granular Trends & Preferences: With beacons, buying/behavioral trends & preferences would be available in such a great variety & granularity that it would give an almost complete picture of the customer’s physical behavior within the retailer’s premises. For example, retailer can get the data about the products searched, time spent in various sections of the outlet, number & frequency of visits to the outlet etc.   With proper analysis of this data, retailers would be able to draw trends & judge preferences like they’ve never done before. 2. With such near complete profiles of their customers, it would be possible for retailers to take informed decisions on various value added services. Retailers would be able to fine tune their offerings to the actual behavior of customers, not the needs perceived through the surveys. 3. Campaigning would also become easy for retailers as they will be able to send instantaneous offers to the shoppers present in the outlets. The ROI on beacon investment is looking quite optimistic.
However, for all above possibilities to become a feasible solution, many pieces of the beacon jigsaw have to fall into place. Platforms for beacons are yet to flourish & there is great need for their growth. These platforms are going to act as drivers for the adoption of this technology. Many retailers would not want to develop their own platforms as it involves a huge amount of work & a great deal of risk. Furthermore, as with any technology, a fair amount of resistance is to be expected from the customers. Beacon applications may seem quite intrusive on the surface & customers may have privacy concerns. Also, something needs to done about the auto-activation of beacon feature in the mobile devices. Customers cannot be expected to turn on beacon every time they are in the vicinity. Inversely, asking the user to keep their beacon signal always on may make the users prone to security issues.
All things considered, beacon technology is definitely an awesome development in the customer engagement & location-based targeting domain. Sure it’s still in the nascent stage, but it is definitely heading towards becoming a great addition to one’s communication repertoire. Beacon industry is still taking shape, and Apple Inc. seems to have taken a lead, but beacon (Bluetooth 4.0) inclusion in android is rapidly gaining ground & that is bound to make the market fiercely competitive. However, the question, ‘Will Beacons become the guiding lights of customer engagement?’ remains unanswered for now.        

Tuesday, 8 July 2014

Walking The Tightrope Between “Driving Repeat Purchase” And “Rewarding Loyalty”

I recently received an offer for INR 100 discount on my next trip on Meru Cabs, India’s leading cab dispatch company. To redeem this offer, I’d need to enter a certain code when I used the company’s mobile app to book my next ride.
My first reaction to this offer was, “How the heck am I supposed to remember this code when I book my next ride?” Meru Cabs doesn’t operate where I live. While I do visit the cities where it does, it’d be several weeks until that happens. Trying to remember the code until then is asking for too much. Of course, I can always ruffle through hundreds of pictures on my smartphone gallery to locate this offer when I place my next order. But that’s too much trouble for saving a hundred bucks.
So, this offer joined the heap of so many others that I regularly toss out because they’re irrelevant or unredeemable or both.
This got me thinking why Meru Cabs couldn’t automatically apply this discount whenever I made my next booking without requiring me to remember a code. If it did that, I’d surely come out feeling that the company rewarded my loyalty. Since that’d be a major goal of any customer engagement program, shouldn’t all companies including Meru Cabs follow this approach?
Should they? More importantly, will they?
Maybe not. Because, in addition to rewarding loyalty, brands have another important CEM goal, and that’s to “drive repeat purchase”. That goal can’t be achieved by automatically applying the discount on the next order – after all, what’s the guarantee that there’ll be a “next order” at all?
It’s ironical how, in trying to drive repeat purchase, a brand misses out on the low hanging fruit of rewarding loyalty.

While both goals are valid, there’s often a conflict in trying to achieve them simultaneously. Some degree of tradeoff is required. Crafting targeted offers to fulfill one goal at a time could be a good place to begin the tightrope walk between the twin CEM objectives of “driving repeat purchase” and “rewarding loyalty”.
Contributed by: S. Ketharaman